Costs Exceed Benefits Of New EPA Rules

January 3, 2000

President Clinton and the Environmental Protection Agency claim that new clean-air rules will result in benefits five times the value of their costs. The rules would order oil firms to produce cleaner burning gasoline and force makers of sports utility vehicles, minivans, vans and pickups to meet the same air pollution standards as cars.

But substantial numbers of analysts scoff at the agency's claims.

Competitive Enterprise Institute analyst Ben Lieberman points out that most pollution is caused by about 10 percent of highly polluting older cars -- and higher prices for new vehicles due to the more restrictive standards, he observes, could deter people from buying new cars, leaving them to drive around in the older, polluting models.

While the EPA claims the new rules will cut smog by cutting emissions of nitrogen oxides, a 1992 study by the National Academy of Sciences found that cutting oxides often increases smog, especially in urban areas.

Whereas the EPA predicts that cutting sulfur in gasoline will add two cents to the price of a gallon, the American Petroleum Institute forecasts a hike of four to five cents a gallon.

EPA claims the new gasoline requirements won't force small independent refiners out of business, because they will be given extra time to install new equipment. But when California several years ago imposed strict sulfur standards, many small refineries could not afford the new equipment and went out of business.

Experts fear that will happen on a national scale when the new rules take effect.

Source: Charles Oliver, "Will New Clean-Air Rules Work, Or Are They Just More Hot Air?" Investor's Business Daily, December 31, 1999.